In a Time of Crisis, Giving With Intention Means Relying on Good Information

Few people give as generously as philanthropist extraordinaire MacKenzie Scott. She has donated more than $14 billion since 2020 to a wide variety of causes, both known and less-well-known. It is a stunning and ongoing display of generosity, notable not only for its size but also for how thoughtful and intentional it has been.

In the hours and days after flash flooding, a blizzard, a mass shooting or some other event that moves us to give from the heart, it can be difficult to give with that level of thought and intention. But it is possible, and donors can learn from how Scott’s done that over the past few years. Now, naturally, most of us lack the means to hire a consulting group to find and evaluate hundreds of organizations, as Scott has done. But we can make use of resources available to all of us — impartial third-party evaluation in particular.

And it’s crucial that we do so. Philanthropic giving may be up slightly overall in recent years, but the nature of who is giving is changing. Middle-class and lower-middle-class donors are starting to fade from view, and that’s a concern. Although some of America’s wealthiest people (such as Scott, Bill Gates and Melinda French Gates, Warren Buffett and George Soros) give significant portions of their wealth, most do not. In fact, as a rule, lower-income people typically give a higher percentage of what they have than the wealthy do. When everyday donors have access to credible information about how nonprofits operate, they can be just as effective as the MacKenzie Scotts of the world.

Yet the ranks of the middle-class donor continue to thin. More than 60% of such people once gave; now it’s less than half. There are two major reasons for that. One is the restructuring of the tax code that took place in 2017. Until then, the tax code rewarded most Americans for their charitable contributions. But that change nearly doubled the size of the standard deduction, taking away the incentive for many Americans to itemize their deductions and get credit for charitable contributions.

The other reason, of course, is more unstable economic times. Since the pandemic’s arrival, the job market shrank and then returned. Meanwhile, the stock market has rocketed down, up and down again, with each gyration affecting the retirement funds that working Americans hope to rely on someday. It’s no wonder, then, that Americans are more hesitant to give than in the past.

Those factors make it more important than ever that everyday donors have access to philanthropic resources and guidance similar to what the MacKenzie Scotts of the world can use.

Fortunately, they do.

To be clear, I don’t mean that we all are able to hire a team of consultants. But we are able to access freely available and easy-to-use tools that enable us to find the charities doing the work in areas that speak to our hearts, to evaluate those charities, and then to give with intelligence and intention, just like Scott does.

Charity Navigator’s ratings, for example, have evolved in recent years to provide a fuller, more nuanced picture of charities, as well as expanded coverage from 9,000 to almost 200,000 charities. No longer focused merely on how an organization raises and spends its money, the ratings now address how effectively it does its work, how well it reflects and listens to its community, and whether it has a strategic vision.

After all, what stops most people from giving is uncertainty about whether that money will be used effectively. That is a valid concern; we should think of charitable giving just as we do about investments. We should be concerned that our money will do the most good, and as with investments, we need to track progress over time.

The way to remove uncertainty is with information. Financial information about charities is not hard to find, but there’s more to evaluating a charity than looking at how much it spends on fundraising or the salary of its chief executive.

For example, when considering an organization working in an underserved community, what impact has it made, and how does it show it? Is it representative of that community, and does it make an effort to solicit and act on community feedback about its programs? Is the charity true to its mission, and does it have a plan for how it will evolve and continue to serve its community?

Impartial, third-party evaluation paints that picture for donors.

An educated donor is an effective donor, and society benefits as a result. No matter what cause grabs you by the heart and resonates with your passion and values, or whether you can give $10 or $10,000, supporting those charities makes the nation and world a better place. If there’s doubt about where to give, it’s better to have the tools to remove the doubt and to invest in what moves you.

I believe causes pick us, and then people pick charities. Information is power. In the philanthropic sector, donors need reliable information to have the power to do the most good on the issues that matter to them. An independent charity evaluator removes doubt and complication that can lead many donors to hesitate, and helps donors be both intentional and strategic with their giving.

Michael Thatcher is the president and CEO of Charity Navigator, the nation’s most comprehensive evaluator of charities. The organization, itself a charity, helps donors find and support the most effective charities doing work they care about.

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